①Australia's prominent bank Macquarie has released a report, upgraded the ratings of multiple Chinese internet stocks; ② The reason for the upgrade is the increased profit visibility, as well as the continuous policy support from the Chinese government.
On Monday local time, Australian investment bank Macquarie released a report, upgrading the ratings of multiple Chinese Internet stocks, citing improved profit visibility and continued policy support from the Chinese government.
Macquarie is bullish on the growth potential of Chinese internet-related stocks
Macquarie analysts pointed out in the report that there is growth potential in the Chinese internet sector. Compared to early 2023, the fundamentals of Chinese internet stocks are currently stronger, but valuations have only been half of those in early 2023.
Macquarie specifically mentioned that major players in the e-commerce, tourism, and local services sectors will benefit from China's economic stimulus policies and improved operational efficiency.
The report mentions that despite the industry's revenue being impacted by macroeconomic challenges, numerous large platforms have shown resilience through operational leverage and cost optimization. This resilience has now translated into an upward trend in profitability.
Morgan Stanley analysts have raised the valuations of several stocks to align with the outlook for the 2025 fiscal year:
Macquarie will $BABA-W (09988.HK)$And$PDD Holdings (PDD.US)$The rating has been upgraded from "neutral" to "outperforming the large cap";
mcglade also reiterated $JD-SW (09618.HK)$and$MEITUAN-W (03690.HK)$ (3690.HK) and DiDi Chuxing (OTCCode: DIDIY);
They also expect the Chinese government to take further action to stimulate economic growth, especially in the consumer and digital services sectors. They anticipate these companies benefiting from stable competition in the e-commerce sector and continued dominance in local services. Particularly Meituan and Didi – Morgan Stanley sees them as 'quality at a reasonable price' stocks, believing the companies have solid market positions and profit potential.
Overseas potential may bring long-term growth potential
In addition, Morgan Stanley also pointed out, $TENCENT (00700.HK)$ , Pinduoduo and $TRIP.COM-S (09961.HK)$ The company is in a favorable position to take advantage of international opportunities, and the potential for overseas expansion will be a long-term growth driver.
The report also mentioned that investors should pay more attention to the global prospects of the Chinese internet plus-related sector, and although risks related to geopolitical tensions (including the US election and trade policies) may bring short-term volatility, they could also create buying opportunities.
However, Macquarie remains cautious about the online medical and logistics industries. Due to concerns about competitive pressure and profitability, Macquarie has downgraded$ALI HEALTH (00241.HK)$And.$JD HEALTH (06618.HK)$rating.
Editor/rice